TCOM — Trip.com Group Limited

Trip.com Group Limited (NASDAQ: TCOM) — deep-value analysis, REFRESH redo

September 12, 2026 · reference price …/ADS (close 09/11/2026, yfinance) · market cap … · reporting currency RMB, trading currency USD, rate used 6.6974 RMB/USD (CNY=X, 09/11/2026)

Regime: REFRESH. The reference thesis is the 08/21/2026 report (rapoarte/deep/2026-08-21-deep-TCOM.md), and the delta package delta-TCOM-20260911.md triggered the redo on two mechanical grounds: an unclassifiable 6-K filing and two unverifiable falsifiers. The triage understated the event: between the two reports the SAMR investigation closed, and the administrative decision is fully quantified in a 6-K filed 07/27/2026 that the previous analysis didn’t have. This, not the price move (… from … to …), is why the report is being rewritten.

What I inherit unchanged, explicitly (verified as untouched by any new filing): the revenue structure and moat sources from FY2025; the 2015–2025 capital allocation history (Qunar, Skyscanner, MakeMyTrip, BTG); the Thorndike grid and the Outsider score; the O’Glove analysis over the 2021–2025 annual series (receivables, advances, debt, discretionary expenses, accruals); the FY2025 profit breakdown into operating and non-operating; the debt structure, maturity schedule and covenants; the incentive structure and the 3% evergreen clause; the FCF bridge as a definition (US GAAP, interest and rent in CFO).

What I fully re-derive: the value and nature of the SAMR sanction; the permanent effect of the cease order on the owner earnings base; post-fine net debt; the treatment of cash access (λ) — a parameter that didn’t exist in the previous report; the balance sheet at 03/31/2026 line by line; the equity portfolio remarked at Q1 2026; all five valuation models and the Monte Carlo simulation.

Primary sources: 6-K 07/27/2026 (the SAMR decision, SEC-Filings\TCOM\TCOM_6K_2026-07-27.txt), 6-K 06/25/2026 (Q1 2026 results with balance sheet and income statement, TCOM_6K_2026-06-25_Q1results.txt), 6-K 09/02/2026 (the Q2/H1 calendar, TCOM_6K_2026-09-02_ex991.txt), the FY2025 20-F filed 04/28/2026, data pack data-pack-TCOM-20260912.md, simulation mc-TCOM-20260912.json. All figures in RMB million unless stated otherwise.

Method note: in this session no semantic vault search tool was available (vault_semantic_search doesn’t exist in the subagent’s toolset). I state this explicitly, per the rule: I did not silently fall back to disk. Prior context was taken from the delta package and the reference report, whose paths were given directly.

Executive summary (1 page: thesis, estimated value, verdict)

What happened. On 07/25/2026 Trip.com received SAMR’s administrative decision closing the antitrust investigation opened 01/14/2026. The authority found a violation of Articles 22(4) and 22(5) of the Anti-Monopoly Law — restricting business partners through exclusivity arrangements without justification and imposing unreasonable conditions — and ordered three things: cessation of the conduct, restitution of RMB 122 mil of security deposits forcibly withheld from hoteliers, confiscation of RMB 1,658 mil of illegal gains, and a fine of RMB 3,521 mil, i.e. 7.5% of the company’s 2025 PRC sales. The sanction SAMR publicly announced is RMB 5,179 mil (USD 765 mil); with restitution, total cash outflow is RMB 5,301 mil (USD 781 mil at 6.7851). The company “sincerely accepts” the decision and will implement a remediation plan.

Why it matters more than the fine. The fine is 3.2% of market cap and 8.0% of net cash — a scratch. The cessation order isn’t. The August report estimated, in the pre-mortem, a “SAMR imposes behavioral remedies, not just a fine” scenario at 35… probability. The scenario materialized. The mechanism hit — exclusivity on hotel inventory — is exactly the one that produced, in 2025, effective commission expansion: accommodation revenue grew 21% on GMV of …, and transportation revenue 11% on GMV of …. This lever is now banned. It isn’t a one-year loss; it’s a mechanism loss.

Quantification. Reversing a single year of commission expansion means RMB 863 mil of accommodation revenue and 1,014 of transportation, i.e. 1,877 mil of revenue disappearing at an incremental agency margin of ~90% → RMB 1,689 mil permanent EBIT, … after tax. The owner earnings base falls from FY2025 FCF of … to … (rounded down). Calibration comparison: SAMR itself confiscated 1,658 mil of illicit gains accumulated on conduct starting in 2020, i.e. ~276 mil/year — my haircut is six times more severe than the regulator’s own quantification, and milder than August’s bear scenario (…).

The second new thing, less visible and possibly positive. The balance sheet at 03/31/2026, published 06/25/2026, shows group equity falling from RMB 170,818 to 165,000 in a quarter when the company earned 2,497 mil. The RMB 8,315 mil gap (over USD 1.2 bn) isn’t broken down — the Q1 release contains neither a cash flow statement nor a statement of changes in equity. The only plausible explanations are the annual dividend declared in Q1 and share buybacks. If it’s the latter, the board has finally used the USD 5.068 bn authorization that had sat untouched and that was August’s thesis’s central behavioral test. I can’t confirm from a primary source; the semi-annual report on 09/16/2026, which as an HKEX interim report must contain both statements, will.

Estimated value. Five independent models give a range from … to …, with a median at … and the base DCF at … (intrinsic value …). Monte Carlo over 20,000 scenarios, with a cash-access coefficient λ = 0.55 explicitly applied, gives a median of …, P10 …, P90 … and an undervaluation probability of …%. The most instructive number in the report is Model 4: earning power value with zero growth, plus 55% of non-operating assets, gives … — within 0.1% of the market price. The market today pays exactly for a no-growth business plus half the balance sheet.

Verdict: HOLD the existing position, DO NOT add before 09/16/2026. The asset-value thesis has strengthened (…% of the price is covered by net cash and the portfolio, versus 55.5% in August, because price fell faster than assets). The growth thesis broke: the cease order is permanent, Q2 guidance of +3… is the first quarter below it, and consensus has cut FY2026 revenue from CN… to 68.0 bn and EPS from 25.28 to 20.50. Q2/H1 results are three days away (announcement 09/16/2026 Hong Kong time, call 09/15/2026 8:00 PM ET) and contain exactly the two figures that decide: post-remedy operating margin and the cash flow statement with the buybacks. Adding three days before a report that is, by construction, the most informative in two years, is a bet, not a value decision. The target position remains 1.0…; a second tranche, conditional on Q2 operating margin above 20% AND confirmed buybacks above … in H1. The margin threshold falls from 22% (August) to 20%, since the remedy is now a fact, not a risk.